Geithner answers some tough questions from the Digg community

In an exchange that must have warmed the hearts of every journalist accused of not getting his facts straight, Treasury Secretary Timothy Geithner answered some tartly worded questions from the Digg online community in a video forum in which he, among other things, attempted to dispel rumors about his own employment history.

The questions were culled from submissions to social-networking site Digg.com and presented to Geithner by Alan Murray, deputy managing editor for The Wall Street Journal.

One Digg member, identified as larryjr88, asked the second most popular question, with 729 "diggs": whether Geithner's previous and current relationship with Goldman Sachs didn't pose a clear conflict of interest, or as larryjr88 put it, "a textbook example of political corruption." Geithner, laughing briefly, noted that he was never employed by the investment bank.

In fact, Geithner said, he spent nearly his entire career since leaving school working in the public sector, and had never had any relationship with Goldman Sachs.

Asked by Murray how such misinformation could seemingly become truth, Geithner said there's no explaining how rumors erroneously become facts. "These things get some salience and currency; it's kind of crazy," he said.

Still, he said, the question proved an important point -- that Americans need to have trust in their public officials.

"It is very important that people understand that the people that hold these jobs . . . need to be held to the highest standards of integrity, and we would never, ever have people in these jobs who would do anything for the benefit an individual company or an individual firm," Geithner said.

The most popular question, with 1,133 diggs, asked why the Federal Reserve Bank, which works with Treasury in several capacities, has never been audited, the implication being that its actions were less than transparent.

Geithner responded that the Fed is subject to "comprehensive oversight" by Congress and external auditors. Nonetheless, he said, the central bank does and needs to maintain a degree of independence to keep politics from influencing monetary decisions.

"I'm sure many of the people concerned about the Federal Reserve system understand that it would be problematic for the country if you let politicians come in and shape conduct and monetary policy for the country," Geithner said, adding that the Fed's actions today are more transparent than in past years.